Online advertising should hit $1.5 billion in 2008, a 25% increase from the $1.2 billion spent in 2007, according to research from the Interactive Advertising Bureau of Canada.

Despite economic uncertainty, the IAB also points to other studies that suggest online advertising will continue to grow at a double-digit pace in 2009.

IAB has no data for the estimated growth of online advertising in 2009, but it cites a recent eMarketer survey which predicts a 15% increase in online ad spending in the U.S. next year, although other studies that take the recent economic downturn into account have concluded there will be zero growth in digital ad spending.

Each study had a different viewpoint of the industry, resulting in distinct forecasts, said Paula Gignac, president of IAB Canada. The total decline to zero in some studies is “a worst-case scenario, and should really only be considered to apply to the U.S. market,” said Gignac.

Based on its review of syndicated media research studies, the IAB concluded the Internet now reaches more adults each week than magazines and newspapers. The web is also neck-and-neck with TV for weekly reach of the 18-24 demographic. However, advertisers aren’t taking full advantage of the Internet, reports the IAB. Consumers spend 23% of their time online a week, but only 8.7% of the total Canadian ad spend went online.

“There is a disconnection here,” Gignac said. “Based on cross-media studies done in [North America], Canadian advertisers should be spending a minimum of 15% of their budget in online if their target market is consumers in the 25-49 age group.”

Not only are advertisers missing out on opportunities to connect with consumers, they are also falling short on prime prospects for high-end goods.

Another IAB Canada study, set for release in January 2009, found that consumers who use the Internet regularly and are light TV watchers (also known as “Internet Imperatives”), make up approximately 25% of adults over the age of 18. This group scores higher than others in terms of recent car purchases valued over $50,000. This group is also more likely to own a house valued over at more than $500,000 and spend more than $1,500 a month on credit cards.

“This research really points the finger at the power of the Internet,” said Gignac.

The most important thing advertisers can do this year is to follow consumers online, she added. “It’s tempting to look at the stock market fluctuations, but you have to pay attention to where [consumers] are spending their time, no matter what the economic conditions are.”